it. It looked so easy. Just tap the equity in your primary home and wham! We’re raking in the money. No problem it’s easy money. Right about now is where you remember the saying, if it sounds too good to be true…it usually is too good to be true.
The clean up of all of this mess created by neophyte investors will take longer than necessary. Coupled with the finance problems in the mortgage industry and the tightening of money by most, if not all lending institutions, have created instant landlords out of flippers. I guess here is where I trow in the line with the realization that something is better than nothing. Yes my friends, we have a surplus of rental units on the market. In Abacoa alone the streets were lined with For Rent signs most of last year. The signs are starting to disappear one by one and the money from the rental market is flowing in again.
Opportunity! With every twist in the markets, there are opportunities for everyone. The way I see it, there’s good news and bad news.
First the good news…the surplus of rental units has created a price war amongst property owners. Locally, rent prices have dropped substantially in the last year. Renters now make “low ball” offers hoping to drive rents down even further knowing there are many eager (hungry) owners. Rental units that were commanding $2,000.00 per month now are renting for as low as $1,400.00. That’s a 30% decrease and a huge savings for the renter. That’s good news…for the renter.
The good news for the flipper now turned landlord, can see this as the opportunity that keeps him from foreclosing and allows him to wait out the market correction. (I know you are asking,”When is that?” It’s coming. Trust me. It’s just not this week.) The ultimate benefit to all this is that the lower housing costs and lower rents will make it more affordable for people to stay or move into the area. We have hardworking teachers, police officers, health professionals, etc. who have dedicated their lives to giving back to our community. We want to keep qualified and dedicated people as citizens of our community.
Now the bad news. With the surplus of rental units available in the Jupiter and Abacoa area, many rental properties are rented without properly screening tenants beforehand. Background investigations are not being conducted. Even worse, some owners are not requiring a security deposit, last month’s rent, or even any money at all to move in. Who are your new neighbors?
As an investor in Jupiter and Abacoa residential real estate, I personally take pride in my homes and tenants. I consider most of my tenants friends and would love to keep them as long as possible. I also require background checks, security deposits and last month’s rent. Have I ever had a problem with a tenant? You bet ya! Although, I do the best I can to protect myself, I have been caught a couple of times buy renters who”fled into the darkness.” However, we are ahead of the game and find the benefits far outweigh the bad.
If you have investment property and need to find a renter, work with a Realtor who can complete a background check for you. Know who is renting your property. We who live and work in Jupiter will applaud your efforts to keep our community safe. Protect yourself financially by always collecting a security deposit and last month’s rent from your tenants.Joe Quirk Email me! (561) 427-9326
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